Structure of PRS
How PRS Works
To start your PRS savings, you may choose to make contributions directly to the PRS Provider or through their registered distributors. Once you have successfully started your PRS savings you are automatically given a PRS account.
PPA, as the central administrator for PRS will be administering your PRS account and will provide you an annual consolidated statement of your PRS account with the PRS Provider(s).
PRS Provider & Fund Options
You may choose to contribute to one (1) or more PRS Provider. Under each PRS Provider, you can further choose to invest into one (1) or more funds by either contributing based on the default option (age-based selection) or select a fund based on your preferred choice.
Default Option for Core Funds (Age Based Selection)
One of the special features of the PRS is that it makes investing your savings for retirement easy with its default option of core funds. PRS default option for core funds offer a packaged mix of underlying asset classes that provides growth, moderate and conservative risk and returns based on evolving life stages towards retirement.
Each PRS Provider must offer three (3) core funds as a default option in their PRS. If you choose the default option you will be allocated to the following core funds based on your age grouping:
|Core Funds||Age||Asset Allocation|
|Growth Fund||Below 40 Years||Maximum 70% in equity; 30% in debentures/fixed income and money market instruments|
|Moderate Fund||40-50 Years||Maximum of 60% in equity; 40% in debentures/fixed income and money market instruments|
|Conservative Fund||50 Years and above||80% in debentures/fixed income instruments of which a minimum of 20% must be in money market instruments and a maximum of 20% in equity|
Default Option for Core Funds: Auto Glide Path
Default option funds offer an automatic glide path in managing your funds towards retirement. The auto glide path is a unique feature of the default option funds where the PRS fund manager automatically switches your funds from a higher risk growth asset allocation to a more conservative lower risk asset allocation as capital preservation should take priority as you approach your retirement. This auto glide path makes it easy for you to manage your risk exposures over time based on a defined age grouping within each default option funds.
Alternatively, if you prefer to choose your own funds (self-selected option), you may choose any of the non-core PRS funds, which will require you to be actively involved in selecting funds based on your risk and return expectations. However, this will often require you to seek advice from a licensed PRS Consultant.